Hi,
I took a distribution from my Rollover IRA in 2023. Although taxes were taken out of my distribution, I still owe around $2500 due to my normal income. Can I contribute money to my IRA so that I don't owe the IRS that much money? I am 66, fyi.
Thanks for any advice!
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Possibly. Whether or not you can make a Deductible Traditional IRA Contribution depends on your Modified Adjusted Gross Income (MAGI) and whether or not you are "covered" by an Employer-Sponsored Retirement Plan (Retirement Plan Box Checked on Line 13 of your Form W2). In addition, your return must include "earned" income such as wages or profits from operating your business. For more details, please see IRS Topic 451, IRAs.
If you are unmarried and you are not covered by an Employer Sponsored Retirement Plan, you can make a Deductible Traditional IRA Contribution no matter what your MAGI.
If you are Married Filing Joint and you are not covered by an Employer Sponsored Retirement Plan but your spouse is, your ability to make a Deductible Traditional IRA contribution phases out when your joint MAGI is between $218,000 - $228,000.
If you are covered by an Employer Sponsored Retirement Plan, your ability to make a Deductible Traditional IRA contribution phases out when your MAGI hits certain levels based on your filing status:
Possibly. Whether or not you can make a Deductible Traditional IRA Contribution depends on your Modified Adjusted Gross Income (MAGI) and whether or not you are "covered" by an Employer-Sponsored Retirement Plan (Retirement Plan Box Checked on Line 13 of your Form W2). In addition, your return must include "earned" income such as wages or profits from operating your business. For more details, please see IRS Topic 451, IRAs.
If you are unmarried and you are not covered by an Employer Sponsored Retirement Plan, you can make a Deductible Traditional IRA Contribution no matter what your MAGI.
If you are Married Filing Joint and you are not covered by an Employer Sponsored Retirement Plan but your spouse is, your ability to make a Deductible Traditional IRA contribution phases out when your joint MAGI is between $218,000 - $228,000.
If you are covered by an Employer Sponsored Retirement Plan, your ability to make a Deductible Traditional IRA contribution phases out when your MAGI hits certain levels based on your filing status:
Thank you Rachel, perfectly explained.
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